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Company rescue professionals from South African Airways offered severance packages later this month to all troubled airline staff after failing to get additional support from the government earlier this week. The airline wanted a R10 billion bailout from the Department of Public Enterprises, which was rejected.
In the draft agreement seen by Fin24, practitioners say the airline is unlikely to have a successful change as a result of the commercial rescue process.
The proposal is that more than 4,700 employees will receive as part of their severance package one week of compensation for a full year of service; payment of remuneration of one month instead of payment by notification, independently of any other contractual provision; payment for accumulated and untaken annual vacations; and a 13th prorated checkup where applicable
To meet these obligations, SAA will have to dispose of assets.
The National Transportation Movement (NTM) has countered the offer, proposing that the services of all fixed-term contractors and consultants be terminated on April 30; It also wants employees over 55 to receive early retirement with an additional incentive such as a 6-month salary.
The union wants voluntary severance packages to be offered to all its other members of at least three weeks’ salary for each year spent. This also applies to early retirement.
The SA Pilots Association said it would still need to poll its members regarding the offer, while the majority union, the National Metalworkers Union, said it cannot comment at this time.
